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Cash settled futures contract

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Taylor Series stock is $562/sh today and its futures contract (due in 6 months) is $580. Dividends of $2 are expected in 1 month and 5 months. The interest rate is 4% p.a. (flat term structure with no compounding). Detail your transactions and cashflows to make riskless profits. Show that a cash settled futures contract has the same profit as a deliverable contract

Reference no: EM133113950

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